The Debt Management Office, DMO, says Nigeria’s $13.46 billion World Bank loan is a plus because the loans which came from the international Development Association (IDA) and the International Bank for Reconstruction and Development (IBRD) were concessional, with low charges and for very long tenors.
In a statement, responding to media reports on Nigeria’s debt to the World Bank, the Debt Management Office says Nigeria’s indebtedness to IDA grew from $6.29 billion in 2015 to $13.46 billion in 2022. While noting that the figures in the media report are correct for IDA loans only, the DMO says it is actually a positive development for Nigeria contrary to the narrative in the media reports, as IDA loans are concessional, that is, they attract low charges and are for very long tenors in some cases, exceeding 30 years.
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According to the DMO, these are the types of loans required to fund development in countries such as Nigeria, and by accessing IDA funding, the Government is actively reducing debt service costs, since non-concessional funding is usually more expensive and for shorter tenors.